Monopoly money: is big business too big?
Tax them. Regulate them. Break them up…. Large corporations are increasingly coming under the cosh. Leading businesses are said to have become too big, and industries too concentrated, for the good of society. The domination of the economy by big corporations is thought to be aggravating many contemporary economic, social and political problems. It is claimed the financial system crashed a decade ago because the banks were ‘too big to fail’. In Britain, the travails of the energy market are attributed to the dominance of the ‘big six’ providers.
Most prominently and controversially of all, Big Tech has become the new Big Oil. According to many commentators, the earlier promise of new technologies coming out of Silicon Valley has turned into a threat. A handful of tech companies led by the FAANGs – Facebook, Apple, Amazon, Netflix and Google – are said to be exploiting their positions of power. They avoid paying their taxes, they abuse their workers, and they are irresponsible, if not duplicitous, in how they use their customers’ data.
These large corporations are also intervening more in politics, by lobbying and electioneering. More widely, their antics are thought to be fuelling today’s heightened sense of injustice and unfairness. Meanwhile, attempts to promote small businesses and entrepreneurialism don’t seem to get anywhere. Promising start-up companies are either squeezed out or bought up by the tech giants. The big businesses just seem to keep getting more dominant.
Yet it is also the case that these big firms are providing new and attractive services for customers thanks to a willingness to innovate. Who would have expected Netflix, for example, to shift from a postal service for renting DVDs into becoming a huge creator of films and TV series, available on demand via streaming? Many would argue that these companies’ market value is a consequence of their popularity rather than monopolistic behaviour, while other big firms – such as Nokia, Yahoo and MySpace – offering similar services have waned or disappeared altogether.
Is the dominance of Big Tech the result of monopolies pursuing their narrow self interests? Do big businesses deserve their bad reputation? Are industries really more concentrated these days? Do we need a return to the trust-busting policies of the early twentieth century? Is the decline in business start-ups a consequence or a cause of concentration? Is tougher state regulation a potential solution, or have its policies been part of the problem?